COIN Cut-off time vs Groww App Cut off time

Hello Friends,
I have substantial investments in the stock market through Zerodha. It has been quite a happy experience with them so far.

Additionally, I have invested in different equity and debt mutual funds through Zerodha Coin, heavily. However, here I have always felt that their cut-off time of 1.30 PM is too early for the day. Often, the trend of the stock market changes after 2.30 PM, so investing by 1.30 PM is almost like a blind investment. If the cut off time is at 3 PM, you have a clear idea whether you wanna buy mutual fund that day or not (with all due respect to SIP supporters,the point here is about lump-sum investors only).

So far, I was trying to work around this issue with some hassle. But now, many of my friends are moving from Zerodha to a new mutual fund investment platform named “GROWW”. There, the cut off time is at 3 PM for equity mutual funds and the other facilities are same. They also have some additional features such as, star rating and pros/cons of funds which is useful. My friends now strongly recommend this app only for mutual funds.

This has put me in a fix. Transferring all of my investments in mutual funds from Zerodha to GROWW would be a hassle. Zerodha is quite familiar for me, so bit of inertia is also there. Yet, the 3 PM Cut Off Time is quite attractive and would be a big help.

Therefore, would you people please give some pointers to help me make a decision on this? Should I move to GROWW or stay put in Zerodha? Are the Zerodha owners thinking of increasing the cut off time to at least 2.30 PM by any chance?

Thanks and regards

Hmmm, this is one of those common foibles. If you are investing for the long-term, and I am assuming that’s what mutual funds are, this makes ABSOLUTELY no difference. Here’s the data. However, if you are doing tactical investing, which I am guessing not, because it is not possiblee with mutual funds, you are better off with ETFs.

I didn’t get this. 1.30 is blind but 2.30 is eyes wide open?

Star ratings are totally useless. ALL star ratings are based on based past returns and past returns historically have been poor predictors of future returns. If you go look at all the funds that were affected by the DHLF and IL&FS crisis, most of the funds were rated 5 starts. And some of these funds fell by as much as 50%. Moreover, the 3 different ratings providers - Morningstar, VR, CRISIL rate funds differently. A fund might be rated 5stars by Morningstar but rated 2 by CRISIL, how will you decide? You have a better chance of picking a fund by closing your eyes and placing your finger on a list of funds.

There were 2 ultra-short funds which fell about 5% in a week, that were rated 5 stars. 5% is how much you make in a year in a ultra-short fund. So, 1-year’s worth of returns were wiped out in a week. Anyway, if you want more data on why star ratings are useless, here’s an extensive article:

What pros and cons? :slight_smile: If selecting a MF was as easy as reading pros/cons, everybody would be a millionaires. These are all eye candy features which add ZERO value!

Bottom line: star ratings, pros, cons, cut-off times makes ZERO difference in the long run. I can post a mountain of more data. All this is plain useless, keep investing in a disciplined manner as per your goals and get your asset allocation right which is a billion times more important than these other pointless things.

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Rahul,
Thanks for your detailed reply.

The link on star ratings from ‘WSJ article on Morningstar’ is a good one. Agreed, there are other variables that affect the fund performance, nevertheless, the star rating gives you a basic idea. This is what Morningstar argued once and later used this data in its reply to WSJ.

A compare fund option with several of their features would be a better option on Zerodha. I hope they are working on it and would bring in its future upgrades.

On cut off time, I differ with your point. 1.30 PM is too early cut off time to place a buy/sale order in a mutual fund. Most of Zerodha’s competitors, whether its HDFC Securities, 5Paisa, Groww…all keep it till 3PM.

Even if Zerodha argues that it cant stretch it up to 3PM because of BSE STAR, an effort to move the cut off time up to 2.30 PM will be a major improvement and a big selling point.

You may strive to trivialize the issue but it’s making a difference in public’s choice while opting for options to purchase mutual funds. Indian investors may think long term but the order day’s NAV matters to them. That’s the reason I am hoping this issue will be clarified and resolved by Zerodha.

What have you sold in life bro?

Can you give an example of this. I mean can you provide a concrete real life example as how the cut off time will have a huge impact on your returns? How can it be a big help?

I m also a investor via coin.

I really would like to know how “big” of help it is?

We are working on adding better data points and features to help discovery.

Yep, this is on our list of things to do.

It actually isn’t, this is after speaking to our users. We’ll, however, look into this. But if you are actually making long-term decisions, it doesn’t make a difference. There’s plenty of data out there.

The best investing outcomes are achieved when you just automate and ignore everything. Out of sight out of mind.

That’s why a SIP works beautifully. However, you can still make use of the conditional orders on Coin.

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Thanks Bhuvanesh!! Glad to know that upgrades are coming in coin. More the merrier !!

Please look into increasing the cut off time. If you need more feedback on it, ask some of the people who have recently (last 1-2 months) moved their mutual fund portfolio to different platforms from Zerodha. You will get a better appreciation of the issue.

Thanks again.

i dont understand , what is the difference between 1.30 and 3 PM nothng difference its all will purchase on daily closing NAV its not a matter baba

Account liquidity is more certain at 3pm compared to 130pm.

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This would be a big help, esp for newbies. And has been long awaited on Coin. I too had made similar points in the past.

This may or may not be a “major improvement”. However, clearly a later investment time is technically feasible and has been available with other platforms. What this does is allow investors greater flexibility with their investment decisions. For e.g. I at times have forgotten to place orders in coin by 1.30, and as a result end up not being able to invests. If this cutoff was say 2.30, I would most likely have had time to invests. Also, it helps with funds management – I can chose to prioritize direct investments depending upon the markets that day or put money in MF.